Being held over a barrel

It is fairly common, when buying or selling a pub, to have a simultaneous exchange (of contracts) and completion. Partly this is because the parties’ preferred completion date is too soon to allow for all the pre-contract work to be finished a couple of weeks before the completion date – as a result, the parties often book removal arrangements, etc, on trust.

This trust can be abused: if the seller makes removal arrangements, has a leaving party, etc, without contracts being exchanged, there is the risk that the buyer will take the opporunity to reduce the price they are offering. In these difficult times for pubs, it is a brave seller who tells such a buyer to go forth and multiply: it could be many months before another buyer is found

Ideally, a seller should not make any firm completion arrangements unbtil contracts are exchanged, and should insist on a reasonable gap between exchange of contracts and completion to allow those arrangements to be made. However, life is not ideal, and sellers do commit to a date without having a binding contract in place. As a result, the buyer often has them over a barrel when it comes to re-negotiating the price at the last minute